Netskope (NASDAQ: $NTSK) is a cloud-native security platform that offers data security via real-time threat protection, visibility, and data loss prevention. It also stops malware, blocks risky cloud activity, and ensures compliance. On Thursday, December 11, 2025, Netskope released its Q3 results. Here is a deep dive into those results.
Netskope Q3 Results
For the third quarter, Netskope reported an adjusted EPS loss of $0.10, a massive improvement from the $0.37 loss reported last year, and above estimates of an EPS loss of $0.25. The company’s revenue for Q3 came in at $184.2 million, a 33% YoY increase, and above estimates of $176.05 million. Revenue increase was driven by the growing use of its One Platform.
In more positive news, Netskope reported a 34% YoY increase in Annual Recurring Revenue (ARR) to $754 million, while its remaining performance obligations blasted past the $1 billion mark, a 41% YoY increase.
For the third quarter ended October 31, 2025, Netskope reported an adjusted loss of $0.10 per share, significantly narrower than the $0.37 loss per share recorded in the same period last year. Revenue surged 33% YoY to $184.2 million, driven by growing adoption of the company’s Netskope One platform. Annual recurring revenue (ARR) increased 34% YoY to $754 million, while the company surpassed $1 billion in remaining performance obligations, reflecting 41% YoY growth.
Other Q3 Highlights
Netskope reported a $28.2 million non-GAAP loss from operations, a reduction from the $35.5 million loss reported last year. Its non-GAAP margin came in at negative 15% compared to negative 26% last year.
It reported $11.2 million in net cash from operations, compared to negative $10.9 million last year, for a cash flow margin of 6%, compared to negative 8% last year. Free cash flow was reported at $10.6 million for this quarter, compared to a negative $28.6 million last year. Its free cash flow margin was 6% this quarter, compared toa negative 21% last year. The company ended the third quarter with $1.2 billion in total cash, cash equivalents, and marketable securities.
In September 2025, Netskope completed its IPO, during which it raised $992.2 million in proceeds, net of commissions and underwriting discounts.
Q4 And Full-Year Outlook
For Q4 fiscal 2026, Netskope expects revenue of $188 million to $190 million, beating forecasts of $185.5 million at the $189 million midpoint. The company forecasts a non-GAAP operating margin of negative 14% to 13%. It expects an adjusted EPS loss of $0.07 to $0.05, above estimates of an adjusted EPS loss of $0.14.
For the full year, the company expects revenue of $701 million to $703 million, and a non-GAAP gross margin of around 75%. The company expects free cash flow of $5 million to $8 million for fiscal 2026.
Commenting on the results, Netskope CEO Sanjay Beri stated that they “delivered an excellent third quarter with accelerating top-line growth and incremental improvements to the bottom line.” He added, “Cloud modernization and AI are fueling strong demand for our market-leading Netskope One platform of security, networking, and analytics products. And, the investments we’ve made in our foundational technology architecture, NewEdge private cloud, and go-to-market engine are driving clear returns as we successfully scale to address our estimated $149 billion market opportunity.”
Market Performance
Following the improved margin and expanding customer base, Netskope shares dipped 6.89% in premarket trading to $21.88 per share. This follows a gain of 4.4% at the close of trading on December 11, 2025, to $23.50.
Year to date, NTSK shares are up 2.17%, while over the past month, the stock is up 7.26%. The stock’s last closing price is above its 50-day moving average of $21.37.
Analysts are optimistic about the future of Netskope, giving it a strong buy rating. They forecast an average price target of $26.93, which is a 14.60% upside from the last closing price. The analysts give a wide range of forecasts, with a high of $3, and a low of $25.
Is Netskope A Buy?
Netskope had a massively successful IPO in September, and the first results since its public listing signal that it has put those funds to good use. The customer base is expanding, and there is a massive growth opportunity in the cybersecurity sphere. Additionally, margins have improved massively. Consequently, adding NTSK to your portfolio could potentially be beneficial in the medium term.
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